Tom Walsh’s column on Detroit’s impending bankruptcy

Walsh is one of the better Free Press writers IMO, and he hit the nail on the head with today’s piece on Detroit’s potential trip to bankruptcy court, which is looking increasingly likely.

I found the comments by “restructuring guru” Ken Buckfire particularly insightful:

“What we’re really saying to the creditors is, you were unfortunately invested in a Madoff scheme,” Buckfire said…

“The city of Detroit made promises they could never pay. It wasn’t us, it was 40 years of bad politicians,” Buckfire added, noting that unsecured creditors may get nothing and others face significant cuts. The message is, “We can‘t pay you. Here’s the best we can do, and here’s what’s best for everybody. So it’s rough justice,” he said.

…Orr and Buckfire have concluded that Detroit’s extraordinary mess is in a class of its own.

“I think Detroit is totally unique,” Buckfire said. “It doesn’t set a precedent for anybody else. You’re talking about a city which has been hammered by two incredibly major trends. One is the decline of its core manufacturing base, which we all know about. Second, is the sheer political mismanagement over 40 years.

“Maybe you could have survived one; you can’t survive both,” he added. “So how is any other city in America like that? Even though there are cities that lost their manufacturing base like Pittsburgh, even Dayton, they didn’t have this kind of problem because they were well run politically.”

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3 thoughts on “Tom Walsh’s column on Detroit’s impending bankruptcy

  1. I have to wonder if “40 years of political mismanagement” is specifically intended to align with the 40 years that Detroit has had a black mayor, or if that’s just coincidence?

    While I’ll agree that Detroit’s leadership could have reduced today’s problems by more effectively triaging and reacting a decade or two ago, identifying this as /the/ cause ignores the out-migration of people and industry that started in the 1950s — Mr. Buckfire apparently needs a copy of “Origins of the Urban Crisis” — and also ignores the sheer scale of the problems. Dayton’s lost 125,000 people since it’s peak; Pittsburgh 300,000: 1.3 million is somewhat larger. The City shares blame for the current situation, for sure, but I find the version presented by Walsh nothing but victim-shaming.

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